NextEra Energy Partners, LP (NEP - Free Report) declared the pricing of a public offering of 10,402,000 common units. Priced at $29.48 per common unit, the offering is expected to close on Sep 14. The units represent limited partner interests in the partnership.
The partnership has also granted underwriters a 30-day option to buy an additional 1,560,300 common units. The partnership intends to use the proceeds from the unit offering to fund its recently announced purchase of a 24% stake in Desert Sunlight Investment Holdings and for general partnership purpose.
Energy companies routinely issue units to fund acquisitions and organic growth projects. The prevailing low interest rate environment enables them on this front as they get access to cheaper financing.
Purpose of the Offering
NextEra Energy Partners has inked a deal with an affiliate of its sponsor, NextEra Energy, Inc. (NEE - Free Report) , to purchase a 24% stake in Desert Sunlight Investment Holdings, LLC, for a consideration of approximately $218 million.
Desert Sunlight owns two projects, of which one is the 550-megawatt (“MW”) Desert Sunlight Solar Energy Center in Riverside County, CA. The plant utilizes 8 million panels, generating enough power for 160,000 homes. The projects are fully contracted under long-term power purchase agreements and have remaining average contract lives of 21 years.
NextEra Energy Partners expects the acquisition to provide accretion in the range of nearly $43–$53 million to 2016 adjusted EBITDA and $21–$26 million to cash available for distribution. The deal is also expected to result in an increase in third-quarter 2016 distribution from the current annualized rate of $1.32 per unit to $1.365. (Read more: NextEra Energy Partners to Buy Stake in Desert Sunlight).
Zacks Rank & Key Picks
NextEra Energy Partners carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the same space are Ormat Technologies, Inc. (ORA - Free Report) and Gevo, Inc. (GEVO - Free Report) . Ormat Technologies sports a Zacks Rank #1 (Strong Buy), while Gevo carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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NextEra Energy Partners, LP (NEP - Free Report) declared the pricing of a public offering of 10,402,000 common units. Priced at $29.48 per common unit, the offering is expected to close on Sep 14. The units represent limited partner interests in the partnership.
The partnership has also granted underwriters a 30-day option to buy an additional 1,560,300 common units. The partnership intends to use the proceeds from the unit offering to fund its recently announced purchase of a 24% stake in Desert Sunlight Investment Holdings and for general partnership purpose.
Energy companies routinely issue units to fund acquisitions and organic growth projects. The prevailing low interest rate environment enables them on this front as they get access to cheaper financing.
Purpose of the Offering
NextEra Energy Partners has inked a deal with an affiliate of its sponsor, NextEra Energy, Inc. (NEE - Free Report) , to purchase a 24% stake in Desert Sunlight Investment Holdings, LLC, for a consideration of approximately $218 million.
Desert Sunlight owns two projects, of which one is the 550-megawatt (“MW”) Desert Sunlight Solar Energy Center in Riverside County, CA. The plant utilizes 8 million panels, generating enough power for 160,000 homes. The projects are fully contracted under long-term power purchase agreements and have remaining average contract lives of 21 years.
NextEra Energy Partners expects the acquisition to provide accretion in the range of nearly $43–$53 million to 2016 adjusted EBITDA and $21–$26 million to cash available for distribution. The deal is also expected to result in an increase in third-quarter 2016 distribution from the current annualized rate of $1.32 per unit to $1.365. (Read more: NextEra Energy Partners to Buy Stake in Desert Sunlight).
Zacks Rank & Key Picks
NextEra Energy Partners carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the same space are Ormat Technologies, Inc. (ORA - Free Report) and Gevo, Inc. (GEVO - Free Report) . Ormat Technologies sports a Zacks Rank #1 (Strong Buy), while Gevo carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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